Technical outlook:
EURUSD rallied to the 1.1095 high on Wednesday, testing its previous swing high at 1.1076 and again threatening a breakout. Yet again, the single currency pair reversed sharply lower breaking below 1.1040. It is seen to be trading close to 1.1060 at this point in writing and needs to settle below 1.1095 to keep the bearish structure intact.
EURUSD is potentially retracing its larger-degree upswing between 0.9535 and 1.1035 and is expected to drop below 1.0500 to complete the complex corrective wave. The instrument now has to break below 1.0960 to confirm that a top is in place and that the bears are back in control. A push above 1.1095 will delay matters further.
EURUSD faces intraday resistance around 1.1070, the Fibonacci 0.618 retracement of the recent drop between 1.1095 and 1.1040. Prices can produce a bearish reaction and drag below 1.0960. Also, note that the RSI has been producing a bearish divergence on the daily chart, which again encourages the bears.
Trading idea:
A potential drop against 1.1200
Good luck!
